What is an Advisor Agreement?

An advisor agreement is the short contract that sets what an advisor will do for your startup and what equity they earn for doing it.

How does an advisor agreement work?

It names five things: the scope of work, the term, the equity grant, the vesting schedule, and how either side ends it. Confidentiality and IP assignment sit at the back. Most run one or two pages, and the grant is usually tied to a tier: standard, strategic, or expert.

Why does an advisor agreement matter?

It prevents the two usual failures. An advisor who goes quiet but keeps vesting. A founder who leans on someone who never agreed to the work. It also keeps your cap table explainable when investors run diligence.

Where did advisor agreements come from?

The Founder Institute published the FAST agreement in 2011 to replace handshake deals with one standard template. It set equity by two variables that founders kept arguing about: how deep the engagement goes and how early the company is.

How do you use an advisor agreement well?

Start from a standard template instead of a custom draft. Vest monthly over one or two years behind a three month cliff. Tie any extra grant to work delivered, not to a title. Keep a termination clause you would actually use. Sign it before the first intro, not after.

Bottom line: An advisor agreement turns a vague relationship into a scoped trade: their time for your equity.

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